Practice question · Select all that apply
Which statements about are correct?
Hints
- Its units are objective per unit of constraint.
- In minimisation with reversed constraints it need not be positive.
Show the answer
- A. It measures how much the optimum improves per unit of constraint relaxation
- B. It is called the shadow price
- C. It has units of objective per unit of constraint
Why
is the shadow price with units of objective/constraint. It can be negative (in minimisation problems with reversed constraint direction).
Practise Lagrange Multipliers
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